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Chinese networking equipment maker Huawei has denied reports that Australian security agencies are investigating its business.

Huawei told Bloomberg that it met the Australian Security Intelligence Organization (ASIO) back in June only for what's described as a "routine briefing". Suspicions that there might be something more to he meeting than that were raised last week after The Australianpublished an unsourced report claiming Huawei is employing "technicians in Australia with direct links to the People’s Liberation Army".

The Chinese networking firm reportedly dismissed "several dozen" of its Australian-born workforce, replacing them with Chinese nationals. These Chinese nationals have allegedly been spotted meeting officials at Chinese embassies and consulates in Canberra, Sydney and Melbourne. Huawei employs 120 workers in Australia, 100 in Melbourne and the rest in Sydney.

Huawei said it is normal for a large business operating overseas to have links with its embassy staff. "Our links to the government are no more than any links General Electric might have to the US government, due to the fact that some members of its management team are military veterans and they sell products to the US military," a spokesman told trade publication Telecom Tiger.

Huawei, which was founded by an ex-People's Liberation Army officer, has run into similar concerns in other western countries including the UK, USA and India. For example, Huawei's bid to take over 3Com floundered because 3Com's TippingPoint division supplies intrusion prevention anti-hacker technology to the US military. ®